Growth Stocks
Although growth stock picks can be highly volatile, they can make good long-term investments. They may be well-known stars or quiet gems, but they do share one common attribute—they are growing at a higher-than-average rate within their industry, or within the market as a whole, and could keep growing for years or decades.
And keep in mind that we focus on growth stocks, which have a good long-term history and favourable prospects. We downplay momentum stocks that tend to attract many investors simply because they are moving faster than the market averages, but are liable to fall sharply when their momentum fades.
There’s room for growth stock investing in your portfolio, but make sure you follow our TSI Network three-part Successful Investor strategy for your overall portfolio:
- Invest mainly in well-established companies;
- Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);
- Downplay or avoid stocks in the broker/media limelight.
Make better stock picks when you read this FREE Special Report, Canadian Growth Stocks: WestJet Stock, RioCan Stock and More.
Read More
Close
GOODYEAR TIRE & RUBBER CO. $12.32 (New York symbol GT; TSINetwork Rating: Extra Risk) (330-796-2122; www.goodyear.com; Shares outstanding: 244.6 million; Market cap: $3.0 billion; No dividends paid) reports that its sales rose 12.0% in three months ended December 31, 2011, to a record $5.7 billion from $5.1 billion a year earlier.
The company earned $18 million, or $0.07 a share, compared with a loss of $177.0 million, or $0.73. Earnings benefited from the record sales and the company’s cost cuts, as well as a shift toward higher-priced tires.
Rising costs for raw materials, especially rubber, could limit Goodyear’s earnings growth in the near term. However, its long-term outlook is positive.
...
The company earned $18 million, or $0.07 a share, compared with a loss of $177.0 million, or $0.73. Earnings benefited from the record sales and the company’s cost cuts, as well as a shift toward higher-priced tires.
Rising costs for raw materials, especially rubber, could limit Goodyear’s earnings growth in the near term. However, its long-term outlook is positive.
...
INTUITIVE SURGICAL $528.20 (Nasdaq symbol ISRG; TSINetwork Rating: Average) (515-507-5000; www.intuitivesurgical.com; Shares outstanding: 39.3 million; Market cap: $20.8 billion; No dividends paid) makes the da Vinci, a computerized surgical system.
Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery, and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk.
In the three months ended December 31, 2011, Intuitive earned $151.2 million, or $3.86 a share. That’s up 24.8% from $121.2 million, or $3.10 a share, a year earlier. Revenue rose 27.6%, to $496.8 million from $389.3 million. Intuitive is debt-free, and holds cash of $2.2 billion, or $55.98 a share.
...
Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery, and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk.
In the three months ended December 31, 2011, Intuitive earned $151.2 million, or $3.86 a share. That’s up 24.8% from $121.2 million, or $3.10 a share, a year earlier. Revenue rose 27.6%, to $496.8 million from $389.3 million. Intuitive is debt-free, and holds cash of $2.2 billion, or $55.98 a share.
...
TEMPUR-PEDIC $82.30 (New York symbol TPX; TSINetwork Rating: Speculative) (800-878-8889; www.tempurpedic.com; Shares outstanding: 63.8 million; Market cap: $5.3 billion; No dividends paid) makes and distributes Swedish mattresses and neck pillows made from its Tempur material, which conforms to the body to provide support and help alleviate pressure points.
Tempur-Pedic now sells its products in over 80 countries.
In the three months ended December 31, 2011, Tempur-Pedic’s sales rose 25.3%, to $366.8 million from $292.7 million. North American sales rose 26%, and international sales gained 25%.
...
Tempur-Pedic now sells its products in over 80 countries.
In the three months ended December 31, 2011, Tempur-Pedic’s sales rose 25.3%, to $366.8 million from $292.7 million. North American sales rose 26%, and international sales gained 25%.
...
TIM HORTONS $52.70 (Toronto symbol THI; TSINetwork Rating: Average) (905-845-6511; www.timhortons.com; Shares outstanding: 157.4 million; Market cap: $8.3 billion; Dividend yield: 1.6%) is using its strong earnings to keep expanding. It’s also raising its dividend and buying back shares.
Tim Hortons operates 3,295 coffee-and-donut stores in Canada and 714 in the U.S. That’s up from 3,148 Canadian outlets and 602 U.S. stores a year ago.
The company’s earnings per share before one-time items rose 25.8% in the latest quarter, to $0.65 from $0.52 a year earlier. Sales rose 21.2%, to $779.8 million from $643.5 million.
...
Tim Hortons operates 3,295 coffee-and-donut stores in Canada and 714 in the U.S. That’s up from 3,148 Canadian outlets and 602 U.S. stores a year ago.
The company’s earnings per share before one-time items rose 25.8% in the latest quarter, to $0.65 from $0.52 a year earlier. Sales rose 21.2%, to $779.8 million from $643.5 million.
...
CHEMTRADE LOGISTICS INCOME FUND $16.73 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 41.7 million; Market cap: $697.6 million; Dividend yield: 7.1%) is one of North America’s largest providers of removal services for resource firms, such as oil refineries and base-metal processors. These companies create sulphur, acid and other byproducts as part of their processing activities. Chemtrade converts these substances into useful chemicals, like sulphuric acid. The trust also makes other chemicals.
In the three months ended December 31, 2011, Chemtrade’s cash flow per unit jumped 52.5%, to $0.61 from $0.40 a year earlier. Revenue rose 63.4%, to $247.2 million from $151.3 million. That mostly reflects the contribution of Marsulex Inc., which Chemtrade bought for $419.5 million in June 2011.
Marsulex provides a range of environmental services, including improving air quality and treating and handling industrial by-products and hazardous waste. Revenue also rose due to rising industrial demand and higher market prices for sulphuric acid.
...
In the three months ended December 31, 2011, Chemtrade’s cash flow per unit jumped 52.5%, to $0.61 from $0.40 a year earlier. Revenue rose 63.4%, to $247.2 million from $151.3 million. That mostly reflects the contribution of Marsulex Inc., which Chemtrade bought for $419.5 million in June 2011.
Marsulex provides a range of environmental services, including improving air quality and treating and handling industrial by-products and hazardous waste. Revenue also rose due to rising industrial demand and higher market prices for sulphuric acid.
...
Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific investment advice on a wide range of topics, including the best strategies to use in international stock markets. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “There are 3 convenient ways to invest in foreign growth without getting out of your comfort zone.”...
While alternative energy investments appeal to a lot of investors on an emotional and conceptual level, many offer only limited investment potential. That’s because they may need a long time to move from the research or concept stage to profitability. However, there are renewable energy stocks that already have established businesses, such as hydroelectric power, that cut the risk of their alternative energy investments....
Most investors recognize that aggressive investments have the potential to produce higher returns than the more conservative choices in your portfolio. But they can also suffer bigger losses. As well, aggressive stocks are often more highly leveraged and volatile than conservative stocks. Understanding all this, there are still very good reasons to turn to aggressive stocks. And there are ways to earn big returns without exposing yourself to excessive risk. Here are 4 principles that we use to select our growth stock picks for Stock Pickers Digest, our newsletter for the aggressive portion of investors’ portfolios.
- Limit aggressive holdings to 30% of your overall portfolio. Because aggressive stocks expose you to a greater risk of loss, we recommend limiting your aggressive holdings to no more than about 30% of your overall portfolio....
MCGRAW-HILL COMPANIES INC. $42 (New York symbol MHP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 293.4 million; Market cap: $12.3 billion; Price-to-sales ratio: 2.0; Dividend yield: 2.4%; TSINetwork Rating: Average; www.mcgraw-hill.com) announced in September 2011 that it will split into two separate, publicly traded companies. One of these new firms, McGraw-Hill Markets, will sell a variety of financial-information products. This business will include Standard & Poor’s, which provides credit ratings on bonds, and McGraw-Hill’s J.D. Power market-research firm. McGraw-Hill Markets will have annual revenue of $4 billion. International sales will account for 40% of that total. The other company, McGraw-Hill Education, will publish textbooks for schools and colleges. This business will have $2.4 billion of annual revenue....
3M COMPANY $88 (New York symbol MMM; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 694.5 million; Market cap: $61.1 billion; Price-to-sales ratio: 2.1; Dividend yield: 2.7%; TSINetwork Rating: Above Average; www.3m.com) makes over 55,000 different products. It was formerly known as Minnesota Mining & Manufacturing.
The company owns a range of well-known brands, including Post-it notes, Scotch tape, Scotch-Brite household cleaning products, Scotchguard protection and Thinsulate insulation.
3M has six main business segments: industrial and transportation (roughly 33% of sales and 31% of earnings), health care (17%, 22%), consumer and office (14%, 12%), safety, security and protection (13%, 12%), display and graphics (12%, 12%), and electronics and communications (11%, 11%).
...
The company owns a range of well-known brands, including Post-it notes, Scotch tape, Scotch-Brite household cleaning products, Scotchguard protection and Thinsulate insulation.
3M has six main business segments: industrial and transportation (roughly 33% of sales and 31% of earnings), health care (17%, 22%), consumer and office (14%, 12%), safety, security and protection (13%, 12%), display and graphics (12%, 12%), and electronics and communications (11%, 11%).
...